There is also a pure bond fund among bond funds. Pure bond funds have lower investment risks than bond funds, so there is basically no risk of loss.

Pure debt funds are also bought by many investors because of their low risk. However, some investors find that pure debt funds can also lose money after buying them. Why is this?

Why do pure debt funds also lose money?

The reason why pure debt funds lose money is because when market interest rates rise, bond prices will fall, which will cause the net value of the fund to fall, resulting in bond funds losing money.

Secondly, when the pure debt funds on the market focus on investing in credit bonds, they will also be affected by changes in interest rates and credit risks. These effects will lead to changes in the net value of bond funds.

Credit bonds refer to bonds issued by entities other than the government with agreed cash flows for repaying principal and interest, such as corporate bonds, corporate bonds, etc.

However, although the price of bond funds will be affected and lead to price declines, generally short-term price fluctuations will not be large. In the long term, pure bond funds have a high probability of making money, and if held for a long time, the loss will be minimal.

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When buying pure debt funds, it is recommended to buy some with relatively high yields, so that the fund's returns will be higher if held for a long time. You can use the fund's historical performance yields in the past three months, six months, half a year, etc.

Reference.

Pure bond funds are not capital-guaranteed and interest-guaranteed products, so losses are normal. However, pure bond fund investors generally should have positive returns when selling, because even losses in bond funds are short-term, as long as they are held for a longer period of time.

For a long time, the benefits are basically considerable.